Sunshine for Home Retail

FINE weather and price cutting have helped struggling DIY chain Homebase to like-for-like sales growth for the first time in two years, the chain's owner said. Home Retail Group said a sunnier March and April - compared with last year's rain - helped demand for gardening and outdoor equipment, which generates around 40 per cent of first-quarter sales.

"Homebase in particular saw its performance in gardening and outdoor products benefit from the excellent weather conditions." Homebase, which has 348 stores, has been hindered by poor weather for the past two years, as well as the onset of recession.

During the last financial year, like-for-like sales at the chain fell more than 10 per cent, and Home Retail was also forced to write off £542m from the value of the business.

The more upbeat figures come after rival Kingfisher last week said its B&Q chain doubled retail profits and grew comparative sales by 3.2 per cent during the first quarter.

Meanwhile margin declines were lower at Argos, which grew overall sales by 0.9 per cent to £937m, despite the like-for-like decline.

But Home Retail also warned that the impact of the weaker pound on margins, at both Argos and Homebase, would increase as the year went on, with some of the pain passed on to shoppers.